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Marijuana's safety profile could take a hit following the release of a new study from Colorado State University.

The year may still be young, but 2016 promises to be pivotal for marijuana one way or another.

The expansion of marijuana at the state level is looking like a win-win for residents and legislators. Consumers now have the freedom to purchase legal amounts of marijuana for recreational purposes in four states, and medical marijuana patients in 23 states have access to a new pathway of treatment that may prove safer, cheaper, and more effective than traditional pharmaceutical products.

As for lawmakers, marijuana is packing a tax revenue and licensing fee punch. In Colorado, for example, total marijuana sales hit nearly $1 billion in 2015, generating $135 million in tax and licensing revenue. At least $35 million of this has been earmarked for Colorado's education system, with other funds likely being parsed out to law enforcement agencies and drug abuse programs. The money comes out of the pockets of marijuana-based businesses and marijuana consumers, meaning it's not a statewide tax increase, which is something most residents of these states can get behind.

But the 800-pound gorilla in the room remains the federal government. President Obama doesn't have marijuana on his agenda in the final year of his second term, and Congressional lawmakers seem content to wait until more comprehensive safety data is available on marijuana.

Unfortunately for supporters of the drug, a study released last week didn't exactly strengthen the case for federal approval.

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Evoking all the wrong emotions According to a study released by Colorado State University and published in the journal PLOS ONE on Feb. 29, 2016, people who use marijuana may have a tougher time processing emotions compared to persons who don't use marijuana.

Lucy Troup, assistant professor of psychology at CSU, conducted experiments on 70 people over the course of two years. The group consisted of either medical marijuana users, recreational marijuana users, or non-marijuana users. Researchers used an electroencephalogram (EEG) to measure P3 event-related brain activities of these 70 participants, first asking them to pay attention to an emotion and then identify it, and later on asking them to focus on the sex of the face being shown and then identify the emotion.

The findings? According to Troup and her team, marijuana users and marijuana non-users had indistinguishable scores when they were asked to explicitly define the emotion they were looking at. That's good news.

However, the study notes that cannabis users scored much lower than non-users in the second portion of the test where it came to implicitly identifying emotions. Marijuana users also had a tougher time empathizing with the emotions they were presented with. The data suggested that there may be some compensatory factor involved considering that there was no difference with the explicit identification test, but it appeared that some adverse effect was realized by cannabis users overall. Researchers concluded that their findings merit further research.

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Inaction leads to big disadvantagesIt's important to keep in mind that researchers see a need to conduct additional research, and that we're only talking about 70 participants, which isn't what I would personally deem representative of the U.S. population. Thus, if there are rays of sunshine to take away from CSU's study, it's that correlation does not equate to causation -- at least not yet.

However, the findings still aren't encouraging. Congress needs an impetus to consider taking up marijuana legislation, and studies that highlight potentially adverse effects on the human brain aren't likely to accomplish that.

The big issue is that inaction from the federal government is placing marijuana businesses at two major disadvantages.

First, since the federal government still views the marijuana plant as illegal, banks have kept their distance. In fact, just 3% of the nation's banks are providing financial services to the marijuana industry despite most medical or recreation-legal states having laws in place that act as a workaround. Without access to basic banking services, including lines of credit, marijuana business expansion has been challenging, and security has been compromised since cash is the only form of payment in many instances.

The other issue is that in spite of being illegal at the federal level, marijuana retailers, growers, and processors are still required to pay federal income taxes. Worst of all, they aren't allowed to take normal business deductions like rent.

This is a tough set of challenges for marijuana businesses to overcome, and without the support of the federal government it could be difficult for many to survive over the long run. My personal suggestion, as it's been for years, is to keep your investable money far away from the marijuana industry until the federal government changes its stance.

Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

Author

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and investment planning. You'll often find him writing about Obamacare, marijuana, drug and device development, Social Security, taxes, retirement issues and general macroeconomic topics of interest. Follow @TMFUltraLong